Canada markets closed
  • S&P/TSX

    20,954.99
    -218.46 (-1.03%)
     
  • S&P 500

    4,551.68
    -23.11 (-0.51%)
     
  • DOW

    35,490.69
    -266.19 (-0.74%)
     
  • CAD/USD

    0.8087
    -0.0003 (-0.04%)
     
  • CRUDE OIL

    81.93
    -0.73 (-0.88%)
     
  • BTC-CAD

    72,345.32
    -3,035.73 (-4.03%)
     
  • CMC Crypto 200

    1,402.66
    -71.67 (-4.86%)
     
  • GOLD FUTURES

    1,796.60
    -2.20 (-0.12%)
     
  • RUSSELL 2000

    2,252.49
    -43.58 (-1.90%)
     
  • 10-Yr Bond

    1.5290
    -0.0900 (-5.56%)
     
  • NASDAQ futures

    15,613.75
    +26.50 (+0.17%)
     
  • VOLATILITY

    16.98
    +1.00 (+6.26%)
     
  • FTSE

    7,253.27
    -24.35 (-0.33%)
     
  • NIKKEI 225

    28,806.02
    -292.22 (-1.00%)
     
  • CAD/EUR

    0.6970
    +0.0001 (+0.01%)
     

USD/CAD Exchange Rate Prediction – The Loonie Rises Following CPI Report

  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
·1 min read
In this article:
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.
  • Oops!
    Something went wrong.
    Please try again later.

The USD/CAD declined on Wednesday, despite broader dollar gains following a solid Canadian CPI report and the Fed’s decision to keep rates unchanged. While the Fed’s decision was widely expected, U.S. Treasury yields moved higher. Canadian CPI decelerated following a torid pace in May but still remains elevated and above the Bank of Canada’s target rate.

Technical Analysis

The USD/CAD moved lower, failing near resistance at the 10-day moving average at 1.2598. Support is seen near the 100-day moving average seen near 1.2367. Short-term momentum has flip-flopped and turned positive as the fast stochastic generated a crossover buy signal. Medium-term momentum is negative as the MACD (moving average convergence divergence) histogram prints in negative territory with a declining trajectory which points to a lower exchange rate.

Canada’s Inflation Rises

Canada’s inflation rate slowed in June, rising 3.1% on a year-over-year basis. While inflation remains hot, the figure is down from 3.6% in May, which was the largest increase in a decade. Statistics Canada reported that prices slowed due to the spread of the pandemic. Gasoline prices, saw a year-over-year rise of 32% in June compared with 43.4% in May. Excluding gasoline prices, the annual rate of inflation would have been 2.2%. CPI rose 0.3% month over month compared to a 0.5% increase in May.

This article was originally posted on FX Empire

More From FXEMPIRE:

Our goal is to create a safe and engaging place for users to connect over interests and passions. In order to improve our community experience, we are temporarily suspending article commenting